The Swiss stock market moderated its losses late Tuesday morning, in the immediate wake of the publication of inflation in the eurozone for the month of June – in line with expectations – and in a context of nervousness in France between the two rounds of early legislative elections.
Inflation has marginally approached the 2% threshold considered acceptable by the European Central Bank, rising to 2.5% in June compared to 2.6% in May.
“Christine Lagarde warned that the bank does not have enough evidence that it has regained control over the inflation threat, suggesting that it could skip a second rate cut in July,” Ipek Ozkardeskaya recalled for Swissquote before the report was published.
In the evening, the speakers will be able to get a more precise idea of the configuration of the forces present for the second round of early legislative elections in France, after the deadline for strategic withdrawals has expired.
“The outcome of the first round was certainly more favourable than expected, from the investors’ point of view, but a political paralysis is looming, which risks complicating the implementation of the necessary reforms,” Raiffeisen stressed in a morning commentary.
Also on the agenda for the day are speeches by both Federal Reserve Chairman Jerome Powell and his European counterpart Christine Lagarde, as well as employment data from the country of Uncle Sam.
At 11:05, the Swiss Market Index (SMI) was down 0.78% to 11,956.70 points, after a low of 11,925.71 points. The Swiss Leader Index (SLI) was down 0.74% to 1,937.19 points and the Swiss Performance Index (SPI) was down 0.68% to 15,880.13 points.
The construction materials giant Holcim (-1.7%) had handed the red lantern to the reinsurer Swiss Re (-4.2%), while a major hurricane is lurking in the Caribbean Sea.
Among the heavyweights, food liner Nestle was down 0.1% while pharmaceutical giants Novartis and Roche were down 1.0% each.
Kühne+Nagel (+1.1%) continued to lead the index, benefiting from an upgrade of the recommendation issued by Barclays to “equal weight”. The Schindellegi logistics company was no longer the only happy exception to the general slump, however, joined on the right side of the balance by Richemont (+0.8%), Partners Group (+0.7%), SIG Group and Geberit (+0.4% each), as well as Swisscom, VAT and Sandoz (+0.3% each).
In the broader market, holiday centre developer and operator Orascom DH lost 2.0%, following a land sale in Egypt.
Liechtensteinische Landesbank (-0.6%) acquired the Austrian business of Zurich Cantonal Bank (ZKB, unlisted) for an undisclosed amount.
Hospital communication solutions specialist Ascom (+1.6%) has entered into a partnership south of the Alps for the deployment of its Digistat platform. (AWP)
